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The AAO Weblog covers accounting issues and current events as they relate the practice of investment analysis. All posts prior to September, 2007 are in the public domain, but after September 4, 2007, only subscribers to The Analyst's Accounting Observer will see all posts going forward. Only selected, occasional posts will be released to the public domain from September 4 forward.

Crawling Toward A "Big 4.333"
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Posted by: Jack Ciesielski 4/30/2007 4:23 AM
Interesting development in London, as reported in the Financial Times: Grant Thornton and RSM Robson Rhodes plan to combine operations.

The combined firm would be the next largest firm after the Big Four, but a distant fifth: its combined revenue last year would have been only one-third of fourth-place Ernst & Young's.

The Big Four aren't making up contingency plans, one would think, but it's a healthy development for those who are concerned that the Big Four might become too complacent about their place in the world - and the kind of audit quality that comes from complacence. There's no reason to think that there aren't more combination possibilities at the lower end of the audit world - possibilities that would only be encouraged by regulators. The Big Four, on the other hand, might not get such friendly regulatory receptions if they try to make any more acquisitions of significant size.
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